Kurds Cultivating Their Own Bonds With U.S.

Russell Wilson, a former Republican congressional staff member whom Michaels asked for advice, eventually suggested that the Kurds contact Ed Rogers, a GOP political operative and former White House official who runs one of Washington's most influential lobbying firms. On June 3, 2004, Barbour Griffith & Rogers agreed to represent the Kurdistan Democratic Party for $29,000 a month.

Qubad Talabani said the firm lobbied the White House for the $4 billion.

Twenty days later, on June 23, the U.S. occupation administration in Iraq gave the Kurds $1.4 billion in cash. The U.S. military flew the money -- brand-new $100 bills in shrink-wrapped bricks -- to Irbil on three helicopters.

Although officials with the occupation authority maintained that the payout was the Kurds' share of Iraq's 2004 capital budget and was unconnected to lobbying, Kurdish leaders insist otherwise.

Barbour, Griffith & Rogers's business with the Kurds has since steadily expanded. The Kurdistan Regional Government paid the firm $869,333 for work performed in the first 11 months of last year, according to lobbying disclosure forms filed with the Justice Department.

The firm's lobbying was "very helpful in getting us the oil-for-food money," said Talabani, who now represents both Kurdish parties. "It was a tangible victory for the Kurds."

A Friend in Commerce

Next up was an even bigger prize: the $18.4 billion in U.S. reconstruction funds flowing into Iraq. As with the oil-for-food money, Kurdish leaders believed they deserved at least 20 percent -- their perceived fair share based on Kurds' proportion of Iraq's population.

The State Department had a different view. Kurdistan had been protected from Hussein's army since 1991 by U.S. warplanes enforcing a no-fly zone, and had enjoyed far greater development in the intervening years than Arab-dominated parts of Iraq. Despite Kurdish pleas and vigorous lobbying, the department decided that the vast majority of the reconstruction funds would go elsewhere.

By 2005, Kurdish leaders decided to shift their strategy. Kurdistan was becoming an increasingly popular destination for businessmen who deemed Baghdad too dangerous for visiting or for investment. Rather than argue about aid, the Kurds proposed that the U.S. government encourage American investment in Kurdistan.

Talabani and Ayal Frank, a former congressional staffer and legislative analyst for the Israeli Embassy who was hired as a lobbyist by the Kurdistan Regional Government, sidestepped the State Department in favor of the Commerce Department, which they considered more receptive. "If a door shuts on you," Talabani said, "you go in through the window." After several meetings with Commerce's Iraq task force, Talabani added, "common sense prevailed."

"In some quarters at State, there's this zero-sum view: that helping the Kurds means you're hurting the Arabs," he said. "People at Commerce had a different view. They started to realize that developing safer parts of the country is not detrimental to the rest of the country."

Multiple meetings, phone calls and e-mails paid off on Feb. 20 of this year, when Franklin L. Lavin, the undersecretary of commerce for international trade, traveled to Irbil to promote Kurdistan as a "gateway" for U.S. business in Iraq. Lavin said his visit was designed "to encourage companies that are looking at Iraq . . . to think about particular locales that might be more fruitful environments for starting a business."